Thomas Walkom: How deregulation killed bus service west of Sudbury
It’s hard to get around this great big country. Come November, when Greyhound Canada axes its bus service west of Sudbury, it will be harder still.
In much of Western Canada and Northwestern Ontario, Greyhound operates the only intercommunity bus service available.
The decision by the British-owned transportation giant to cancel virtually all of its routes in the Western provinces and Northwestern Ontario should come as no surprise. It is the inevitable result of governments’ on-again off-again fascination with deregulation.
It is a fascination that has destroyed much of the country’s inter-urban transportation system.
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In the hey-day of bus travel, companies made an explicit deal. They would be licenced to service certain highly profitable routes. But in return, the companies would agree to operate less profitable ones.
It was, in effect, a system of cross-subsidization. And, by in large, it worked. As late as the 1980s, most small communities in Ontario enjoyed some form of regular bus service.
One of the most successful operators in Southern Ontario was the publicly owned TTC’s Gray Coach Lines.
But then came the deregulation craze. It started in airlines and was based on the notion that deregulation, by encouraging competition, would drive down prices.
On well-travelled routes, the notion worked. Fares between big cities like Toronto and Montreal fell as bus companies vied for business.
But that left the companies with less money to cross-subsidize unprofitable routes. So they did the rational thing: They shut those routes down.
Some provinces, such as Alberta, took deregulation to its logical end. Others kept some form of regulation in play.
Ontario took a middle road that combined the worst of both systems. Companies still had to apply for licences to operate bus routes. But once they had those licences, they could raise fares and reduce services as they wished.
Their only obligation was to inform the Ontario Highway Transport Board of their decision.
It was a system that benefitted big operators, such as Greyhound (which by the mid-1990s had purchased most of Gray Coach Lines). On the one hand, their profitable routes were protected from too much competition. On the other, they had to give almost nothing in return.
Under full regulation, bus customers had been able to find out from the regulator which companies operated which services. Under Ontario’s system of faux regulation, that information is no longer centrally available.
To check on whether there is regular bus service from, say, Wingham to London, customers must call whoever operates that service. But if they don’t already know the operator’s name, there is no easy way to find it.
Governments have been fretting over bus service for years. The Senate has studied it, as has a federal-provincial committee of senior officials.
They all agree that bus service is a good thing. It’s cheap enough to let poorer people travel. It services rural areas that airlines can’t or won’t reach.
It’s also good for the environment, producing far fewer greenhouse gas emissions per person-kilometre than train or auto travel.
Greyhound has been whining for years that it is not making enough money operating buses in sparsely populated areas of the country.
In 2009, it demanded government subsidies as the price for keeping bus service alive in the Western provinces. But only Manitoba took the bait. Now Greyhound says it is moving out of almost everywhere except Southern Ontario and Quebec.
The country won’t be entirely bereft. The provincially owned Ontario Northland, for example, operates some bus services in Northwestern Ontario. Some communities in the Western provinces also have access to alternative bus services.
But unless the old bargain of regulation and cross-subsidization is resurrected, a coherent national bus system remains the impossible dream.
Thomas Walkom is a Toronto-based columnist covering politics. Follow him on Twitter: @tomwalkom